Distell invests £10.5m in Scotch whisky distillery renovation

African drinks giant Distell is investing £10.5 million in Scotch distillery Bunnahabhain, which would see the estate transformed into a tourist destination over the next three years.

South African drinks giant Distell International has invested £10.5 million in a new visitor centre and distillery for its whisky brand Bunnahabhain Distillery on Islay. 

The new layout will feature a “brand home” and visitor centre, as well as a café and retail space  which will be positioned along the shoreline with stunning views overlooking Bunnahabhain Bay and the Sound of Islay.

Derek Scott, Distell international’s brand director for malts, said the refurb would allow visitors to “enjoy a piece of Bunnahabhain life.”

“Bunnahabhain has a special place in Islay’s whisky heritage and we are committed to retaining this by turning Bunnahabhain Bay into a world-class whisky destination of choice.

“As the most remote and northerly distillery on the island, our transformation will give those who have made the journey time to pause, forget about the rest of the world and enjoy the serene surroundings.”

Overall, the aim of the project is to make the distillery and surrounding estate easy to navigate for tourists, ensuring the buildings are used more efficiently for storage, and located in better suited, more accessible locations to the production buildings.

Work has already commenced with the demolition of four warehouse buildings, as well as the start of upgrades to the existing pumphouse.

In addition, Scott said the company was also working on ways to reduce its environmental impact. “The whisky industry is starting to be more environmentally aware,” he said.

“Our achievement of recycling over 99% of materials shows, with a little bit of extra effort, it is remarkable what we can achieve.”

In an interview with the drinks business last year, Distell’s MD for Europe, Fraser Thornton, said he hopes to expand the group’s overall turnover by scaling up its growing UK business.

The UK, he explained, is “very small” for the company, accounting for around 2.5% of the remaining 20%.

But the company, which owns cider brand Savanna, believes there is more potential for growth in the UK than in South Africa, where Distell “already have a dominant position.”

“The group’s stated objective is to double the earnings over the next five years,” he said, “and we won’t achieve that level of growth in South Africa where we already have a dominant position – so have to over-deliver on that level of growth internationally.”

“So, in the bit of the world where we sit – which is Europe – we say to ourselves, ‘how can we play a part in that growth ambition?’ What markets can deliver double digit annual growth in revenue and our earnings?’

“And if you look at size of UK market in all the categories we operate, and our relative value share, then that’s what drove our decision to focus on the UK.”